Thursday, June 25, 2026

Water is an Issue, But Not Because of Data Centers or AI

The near-hysteria about water consumption needs to be kept in proper perspective. In the water-short American West, including the Colorado River watershed, water is always an issue. 


In terms of water access, the United States is effectively divided by the historic 100th meridian, which runs roughly through Texas, Oklahoma, Kansas, Nebraska, and the Dakotas. East of that line, rainfall is generally sufficient to support agriculture without irrigation. West of it, irrigation is necessary.


Region

Typical Annual Precipitation

Pacific Northwest mountains

60–150+ inches

Eastern U.S. (most areas)

30–60 inches

Midwest

25–45 inches

Great Plains

15–35 inches

Intermountain West (Nevada, Utah, Wyoming interior, western Colorado)

5–20 inches

Desert Southwest

3–15 inches


But precipitation alone does not illustrate the issue as well as water runoff, which is the amount of liquid that remains available for use after evaporation and plant transpiration. In much of the Intermountain West and Great Plains, most precipitation evaporates or is consumed by vegetation before reaching streams.


Region

Typical Annual Runoff

Appalachian region

15–40+ inches

Upper Midwest

5–15 inches

Great Plains

0.5–5 inches

Intermountain West basins

Less than 1–3 inches

Desert Southwest

Often less than 0.5 inch


Relative to demand, west of the 100th meridian, water is always going to be an issue. 


Region

Water Supply Relative to Demand

Northeast

Large surplus

Southeast

Large surplus

Great Lakes

Very large surplus

High Plains

Small surplus

Southwest

Deficit

Colorado River Basin

Deficit


So it might be inevitable that water footprint becomes an issue for data centers, even if relative water consumption is quite low. Of course, a total water footprint would include the cost of generating electricity. 


Still, industry uses relatively little water, compared to other sectors of the economy. 

source: Axios 


But an argument can be made that the easiest gains might come from increasing agriculture efficiency where it comes to water consumption. 


And even if controversial, the easiest market encouragement might include shifting our subsidies for agricultural water pricing, as difficult as that will be for many farmers always on the brink of survival. 


As always, rights and values are in tension. Most people might say they believe in supporting family farms, just as much as they might say they value water conservation. But the numbers are clear. Small gains in agriculture will produce more efficiency, faster, than small gains in consumption in other sectors. 


Sector

Share of Water Consumption (Typical Western Basin)

Agriculture

70–80%

Municipal

10–20%

Industry

5–10%


Indeed, water pricing discourages efficiency because the users of 70 percent to 80 percent of the water pay the lowest prices for consumption. Again, values are in conflict. We might value food production and small farms as much as we value drinking water and electricity. 


But there is an order of magnitude difference between agricultural water prices and all urban uses of water. And as with all commodities and goods, low prices encourage consumption; higher prices encourage efficiency. 


Tradable water rights might be a preferred solution, shifting supply towards demand without expropriating or destroying farming. Also, it might make sense to encourage water-intensive agriculture only in regions with lots of water, while discouraging it in regions that are water scarce. 


Again, this will be controversial. 


User Type

Typical Economic Value of Water

Alfalfa irrigation

$50–$300 per acre-foot

Corn irrigation

$100–$500 per acre-foot

Municipal supply

$1,000–$5,000+ per acre-foot

Industrial/high-value uses

Often much higher


In other words, does it make good sense to grow water-intensive rice, almonds or alfalfa in water-scarce regions?


Crop

Acre-Feet per Acre

Wheat

1–2

Corn

2–3

Alfalfa

3–6

Almonds

3–4

Rice

4–5


As if that were not complicated enough, we also must balance protection of wetlands, fisheries, recreation and food sourcing. 


Data center water consumption might be an issue, but a relatively small one, overall. How we use and price use of a scarce resource is really the bigger issue. 


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Water is an Issue, But Not Because of Data Centers or AI

The near-hysteria about water consumption needs to be kept in proper perspective. In the water-short American West, including the Colorado R...